The preface to Inside Out ends with what many readers will regard as a much needed apology. Isabel Oakeshott – alternatively described as "ghost" and "co-writer" – explains why Peter Watt has chosen to reveal what he (or she) calls "the story of betrayal and cowardice at the heart of New Labour". He claims that he was left to take the blame after it was revealed that David Abrahams had made secret donations to the Labour Party. "So blind loyalty is no longer something he is willing to give."

Watt was general secretary at the time of what he calls "one of the greatest political scandals" of the decade, and the frequent recipient of Abrahams's hospitality. So the notion that he should take responsibility for the fiasco does not seem wholly unreasonable. Perhaps he was, as he says, badly treated by every senior Labour politician he met – with the exception of Hazel Blears, whose financial probity Watt applauds. But how does that justify a book which – if it has any influence at all – can only damage the party that, he claims still to believe, "offers the best solution to the challenges facing this country"? The question is answered from an apparently limitless supply of clichés: "Loyalty is a two-way street." As a justification for 200 pages of ­malevolent self-pity that is, like the rest of Inside Out, third rate.

If this slight work only dealt with the Abrahams affair it might just be possible to excuse Watt's betrayal as no more than self-defence against the implication that he was not up to the job. (Though whether this defence could be sustained by a man who admitted to leaving a substantial cheque in a suit pocket – with the subsequent fear that it might be sent to the cleaners – and missed an anticipated call from a prospective donor because he had "popped out for a pint" is open to doubt.)

The constant references to his inability to stand pressure – "surge of panic . . . wave of nausea" – might at least have inspired a degree of compassion in some readers. But only 20 pages are devoted to the incident which he seems to believe excuses his calculated breach of confidence. In the rest of the book, Watt and his ghost dredge up every incident within his experience that can be interpreted as an indictment of the Labour leadership, and they make his case all the more distasteful by surrounding it with false piety. The account of John Prescott's embarrassment over his relationship with his diary secretary is typical. According to Inside Out, Watt "tried to be supportive", realising "that it must have been a dreadful time for him and his wife Pauline". But that assertion of human kindness does not prevent him, on the following page, from repeating the canard which he is pleased to report Prescott found most painful.

Most of the mud is flung at Gordon Brown, who committed the unforgivable sin of answering a press conference question about the Abrahams loan by saying what was both obvious and essential. "The money was not lawfully declared so it will be returned." Watt does not say what reply he would have preferred. Nor is it obvious that any alternative response was possible, since, as Watt eventually accepted, the law had been broken. But his entire account of the incident he calls a crisis concerns his feelings, his reputation and his future. The interests of the government, and the party that paid him £100,000 a year, did not concern him because they did not pass through his mind. That was the response of a man in panic.

However, the damage that would be done by the book – less serious in my view than some commentators have gleefully anticipated – must have been calmly calculated. The stories about the PM's plans to abandon the idea of an early election and the tittle-tattle about Brown's personality and his abrasive relationship with colleagues – some of which has been categorically contradicted by politicians to whom the anecdotes are attributed – are ­Inside Out's special selling point.

It was foolish to let talk of an early poll run on for so long and waste so much of the party's scarce resources. And the Metropolitan Police reacted to the allegations of dubious political donations with a wholly unjustified ferocity that had more to do with personal reputations than a zeal to uphold the law. But simply saying so does not amount to "a story of betrayal and cowardice", as the subtitle has it.

If Watt had offered analysis rather than what the cover copy calls "the ultimate insider's exposé", no publisher would have paid him a penny. He had to personalise each issue to make his book marketable. The pages that are not characterised by bitterness and bile do not make gripping reading. The long account of his determination to become general secretary of the Labour party may be of interest to a couple of dozen people outside his family. The chapter called "Dad" – which includes the verbatim text of his address at his father's funeral – is moving in places but should not have been included in a book which it is claimed was written "in the public interest". I doubt if it is even in the interest of Brown's enemies – and it must have deeply damaged Watt himself. The only person to come well out of the whole sorry enterprise is Tony Blair. He was always against Watt becoming general secretary of the Labour party.